When Localities Strike: City Health and Zoning Boards Can Make a Tough Job Tougher

Zoning: Local government zoning regulations can significantly impact pallet and sawmill businesses; a look at potential zoning restrictions and how to navigate the local red tape.

By Matthew HarrisonDate Posted: 12/1/2007

Local health codes and zoning ordinances can put as much pressure on a business as a worthy competitor. Keeping abreast of codes can help a business maintain good standing within the community, as well as reducing expenses from fighting government officials.

Failure to adhere to health, safety, and zoning codes can lead to stiff penalties. In most cases, only a notice or a small fine is incurred by businesses, but repeated offenses can cripple financially a small business. In worst case scenarios, local governments can try to condemn or even demolish businesses because of minuscule code infractions.

A-1 Pallets Challenges Mayor’s Demolition Order

“I was shocked,” admitted Charlotte Reeves when a local reporter informed her that city officials wanted A-1 Pallets gone.

The Jackson, Miss. facility owned by Charlotte has been labeled an eyesore by Mayor Frank Melton.City Council already voted once to demolish the pallet yard, but Charlotte was able to receive a restraining order from a local judge to keep city officials off her property.

Charlotte’s pallet yard was targeted largely in part because of its location in Jackson’s Farish Street Historic District. She admitted that she and her husband were aware of the city’s plans to gentrify the area by remodeling older buildings into boutiques, apartments, and upscale restaurants.

“We bought the building to store our pallets until the Farish Street Historic District gets up and going,” she added. “Once we started seeing that it was going to take off, we were going to convert our pallet company into restaurants, loft apartments, and entertainment to fit right in with that area.”

Since the area around A-1 Pallets remains mostly vacant, Charlotte has used the facility primarily to repair and distribute pallets. “It’s a fenced area zoned I2,” she said of the 5.5 acre site.

I2 zoning is considered a heavy industrial designation in Jackson. “It can be a recycling plant. It can be a junk yard,” Charlotte commented. “It can have the heaviest emissions and the loudest noise. It can be anything you want it to be.” Her pallet facility is located next to a rail yard.“It’s not like we’re in a beautiful upscale residential neighborhood.”

The situation intensified when city officials obtained a search warrant to inspect A-1 pallets for code violations on May 16 of this year. Code enforcement officials requested the warrant because employees of A-1 pallets refused them entry the previous day. “They had gone over there to intimidate our employees,” Charlotte said, adding that the code enforcement officials arrived with police.

On the morning of the 17th, city code enforcement officials completed their inspection and cited A-1 pallets for numerous violations, including broken windows, standing water, and a rat infestation.

“The code enforcers work directly under the mayor,” Charlotte said. “If the mayor told them to find ten white elephants in there, they would have found ten white elephants. They do whatever the mayor tells them to do.” She added that her employees “didn’t see a thing” when city officials allegedly spotted a rat inside the facility.

“At the end of this year, [A-1 Pallets] is going to be gone,” said Melton at a May press conference. “There’s some criminal activity going on in there.”

Charlotte’s company reportedly pays the city over $40,000 in property taxes each year. “You’d think the mayor would roll out the red carpet because we choose to be in Jackson,” she remarked. “We choose to be inner-city, and we hire inner city people.”

Mayor Melton’s persistent threats of demolition prompted Charlotte and her husband to file a restraining order against city employees until the matter is resolved.

Calls to the city offices were not returned.

“It’s hurting our business,” Charlotte acknowledged. She fears that other businesses are less inclined to deal with A-1 Pallets for fear of bad publicity. Furthermore, she and her husband planned to add a pellet mill at the site. Since the future of A-1 Pallets is in question, though, expansion plans have stalled.

Because of its historic designation, demolition of A-1 Pallets requires approval from the Jackson Historic Preservation Commission. Destruction of the landmark could result in lost state and federal funding for future city development projects. The Commission recently voted to deny Mayor Melton’s demolition request, and the Jackson City Council recently approved a six month moratorium on Farish Street Historic District demolitions, but Charlotte’s battle is far from over.

Zoning Definitions in Question

Haven Pallet of Winter Haven, Fla. has struggled to satisfy city planners for almost five years.

“When we first moved in there, we checked the zoning for the county and the city comprehensive plans, and according to what we saw, we were clear,” said frustrated owner Wayne Berry. He believed that since the facility they were leasing used to be a PVC pipe manufacturing plant, they wouldn’t have a problem.

In 2001, Berry and his staff rewired the electricity and upgraded water pipes on the 3.2 acre site. “They signed off on it, passed it, the whole bit,” noted Berry.

Over a year and half later, he received a letter from the city stating that Haven Pallet was zoned improperly. Wayne said that when he first reviewed zoning regulations for Winter Haven, pallet yards were considered light industrial. However, city planners have since told him that his property should be zoned heavy industrial.

“I can have a truss plant, I can have a cabinet shop, I can have everything but a pallet yard,” said Wayne of the light industrial zoning code. “We didn’t see anything in heavy industrial about pallets and crates.”

Wayne added that Haven pallet made concessions to meet all the requirements set forth by the city. His company upgraded fire hydrants and installed water access to locations across the property. Even then, the city still required Haven Pallet to pay the application fee for rezoning.

“When we went before the city planning board, the city attorney wrote a letter back to the city stating that under the circumstances, and that the manufacturing had previously been there, we had the right to remain there,” Wayne said. “It was dropped.”

Since then, Haven Pallet has grown, providing the community with about 40 jobs and a payroll of over $1 million. They work primarily with specialty pallets like 40x40s and 48x45s for housing construction, and occasionally dabble with GMAs. “We don’t go after the big boys,” said Wayne of the fierce GMA competition in Fla. “I’m not going to try to get that cheap. I can go broke out there on the lake fishing,” he laughed.

Aside from routine fire inspections, Haven Pallet did not hear from city officials for several years. Last October, Winter Haven Community Development Director Dave Dickey suggested that the business apply for rezoning again. However, city officials had another agenda.

“We went to the first planning meeting and Dickey recommended that we tear it all down,” Wayne said. “That’s when we got an attorney involved.”

City officials said that the business’s rezoning efforts are “inconsistent with goals and objectives of the Downtown Community Redevelopment Agency plan promoting a mixture of residential and commercial uses in the area.”

Wayne explained that Haven Pallet is surrounded by a cemetery, a used car lot, and a strip mall. He acknowledged that there had been speculation about the city using the property as a city barn, but there has been no mention of the city buying the property as of late. The land is owned as a part of a family trust fund. “They’re not planning on selling to the city or anyone else,” he said.

“I don’t think the city has any interest in acquiring the property,” said Dickey in a statement.

Dickey also admitted that he was notified of the letter from Winter Haven originally approving the land use, but he insisted that the document has not been made available to him. “I’ve never gotten a copy,” he said.

Haven Pallet currently has what amounts to a 30-year lease divided into 6 parts with an option to renew after every 5 years. City officials have requested that Haven Pallet drop the lease when it expires again, but Wayne says he wants to stay put for at least another 15 years. If both parties continue to disagree on when the lease should be terminated, Wayne intends to file suit against the city.

What Can You Do?

“If a zoning body doesn’t like something, they can find reasons why it isn’t compatible,” said Robert Stanz, an attorney representing Haven Pallet. “If you’re in violation of an ordinance, you may not be entitled to any favorable treatment for the city.”

In addition to zoning definitions and health issues, pallet companies often have to worry about noise complaints, environmental impact, and truck traffic that could potentially violate local zoning ordinances.

“No matter what your business is, before you commit to a lease or purchase property, you need to verify that you have the adequate zoning or land use designation to allow your operation,” Robert counseled. However, some smaller localities do not explicitly define which land-use or zoning categories pallet yards fall under.In that case, he suggests obtaining a letter from the local planning committee approving a business plan with potential community impacts clearly acknowledged.

In some instances zoning boards change land-use designations after a pallet yard has been in operation. Usually, businesses are grandfathered because of pre-existing non-conforming use clauses. However, some cities may require businesses to get special-use permits or waivers to continue operations. These usually include a separate clause stating that an excessive cessation in business operation, usually after 6 months or a year, will terminate the permit.

“It’s politics,” Robert said of land-use and zoning disputes. “A lot of it is getting to know the people in the community and getting some community support.” Supporters in the community can prove beneficial, especially in planning committee or city council meetings, because they might be willing to speak on your behalf.

Networking is essential when establishing your business. “It would be best to address the whole commission in advance,” Robert said. Approaching decision makers individually might violate state open records statute or be construed as favoritism. “You go in to the meeting, get on the agenda and speak during the public hearing part for a few minutes,” Robert suggested. He also emphasized the importance of speaking clearly, briefly and directly to the point.

The local chamber of commerce is another terrific place to advocate the positive impact your business will have on the community. However, commerce groups are not always inclined to vouch for small business already targeted by localities.

Charlotte, a member with the Metro Jackson Chamber of Commerce, the Mississippi Economic Council, and the Mississippi Manufacturers Association, said that none of the commerce groups came to her aid. According to Charlotte, representatives said they “don’t usually get involved” with municipal litigation and code enforcement.

Wake Up Jackson, a non-profit community advocacy group, staged a “positive peaceful protest” to raise awareness of A-1 Pallets’ plight. With signs that read “Due Process” and “Mayor Unfair,” representatives from the organization picketed with workers and their families in front of the pallet yard. “They knew how important it was for us to stay in business so they would still have a job,” said Charlotte of the workers who participated in the demonstration. “Passersby could see it and beep the horn, wave, or give a thumbs-up.” The event was also documented by local media.

If a pallet facility is located next to a residential area, involvement with local neighborhood associations will help keep owners informed of public attitudes. Attending an occasional meeting will provide business owners with an opportunity to address local concerns before city intervention is necessary.

Local governments can be extremely persistent when enforcing zoning codes. However, a facility that meets code requirements and is in good legal standing is entitled to protect itself from undue and unreasonable harassment. Litigation is the last line of defense.

Litigation is as expensive as it is tedious, but small-scale grassroots efforts can raise money for legal fees in a pinch. Events like bake sales or weekend musical performances can help a small business earn a favorable public opinion while simultaneously replenishing its coffers.

Employee involvement in local government disputes is also effective because council members become more aware of whose jobs are in jeopardy. Not only does this tactic strike a chord emotionally, but it can also rouse public support against elected officials. Charlotte’s employees have stood with her during city council meetings during previous altercations. “We wanted them to actually see the people that we were employing,” she said. Employees can also participate in letter-writing campaigns and petitions.

Some businesses utilize questionable and often illegal strategies to keep city officials at bay. Exorbitant campaign contributions or other payoffs to gain favor in city council is unadvisable. “You will go to jail quicker than the person you bribed,” Charlotte warned.

“You’re dealing with a power,” added Robert of local governments. “They have the right to do things for the public welfare.” Businesses also have a right to provide for community well-being. Staying informed of municipal development goals and agendas is the easiest way to exercise your rights respectfully. It’ll help you stand if localities try to pull the rug out from under you.